Legendary bond investor Bill Gross urged caution about buying gold, which has been soaring recently, even as he warned on budget deficits and a slowing economy.

In a post on X on Friday, the cofounder of Pimco also acknowledged Wall Street’s anxiety over the past week about problems lurking in banks’ loan books.

Disclosures on Thursday from Zions Bancorporation and Western Alliance Bancorp about dodgy borrowers came after JPMorgan CEO Jamie Dimon pointed to the collapse of auto lender Tricolor as a “cockroach” that likely signals more are hiding elsewhere.

“Regional bank ‘cockroaches’ may continue to affect stocks AND bonds,” Gross predicted.

While analysts don’t think issues at the regional lenders signal systemic problems, memories of Silicon Valley Bank’s implosion just two years ago sent stocks tumbling Thursday and briefly pushed the 10-year Treasury yield below 4%.

But Gross said that move was overblown and instead expects yields to surge well above Friday’s close around 4.01%, given how much fresh debt the federal government must issue to cover budget shortfalls while growth is poised to cool sharply from current estimates of more than 3%.